Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.

24/7 Still a Real Deal

Shareholders have ignored the online marketer's continued growth.

After surviving the dot-com nuclear winter, online marketing pioneer 24/7 Real Media(NASDAQ:TFSM) is marking its 10th anniversary. It's tallied several years of robust growth, and the company's ventures into online video and mobile advertising should help sustain that growth going forward.

The third-quarter revenues 24/7 reported last week increased 44% to $60 million. Unfortunately, the company posted a loss of $200,000, or roughly breakeven on a per-share basis. In the year-ago period, 24/7 posted net income of $1.4 million, or $0.03 per share.

The company's comprehensive technology platform allows advertisers to target 1,500 major websites. It also helps customers find the right keywords and bid amounts when marketing on search engines like Google(NASDAQ:GOOG), Yahoo!(NASDAQ:YHOO), and Microsoft's (NASDAQ:MSFT) MSN Search. Revenue from these online marketing efforts grew 59% to $26 million in the fourth quarter.

Globally, 24/7 enjoyed 72% growth in Korea, and 42% growth in the U.K. It also expanded a search-engine marketing agreement with partner firm Dentsu, which should further improve its footprint in markets like China, India, Korea, Taiwan, and Thailand.

Online video could be another promising growth driver for 24/7. The overall online video ad market measured roughly $325 million in 2006, but it's expected to surge to $750 million in 2007.

Despite the good news, 24/7's stock price has stagnated over the past year. However, as the company's strong growth continues, its valuation has begun to improve. Judging from its $255 million-$265 million revenue guidance for 2007, the firm is selling at 1.4 times forward revenue. Compare that ratio to aQuantive's (NASDAQ:AQNT) 3.4 and ValueClick's (NASDAQ:VCLK) 3.6.

Even in hot markets, a stock can fall out of favor. Investors should focus more on 24/7's commitment to building a platform that should benefit from Asia's growth markets and online video's emerging prominence.